All media spotlights are on Bernard Madoff as he has pleaded guilty to all charges against him in the $50 billion Ponzi scheme. The public speculation is being directed by the big business media to focus on whether or not his wife or relatives were accomplices and whether they will get to keep their ill-gotten gains.

But consider the question of accomplices. If someone robs a bank and the security guards simply look the other way, do those guards qualify as accomplices? Furthermore, if those bank robbers did not have to worry about any alarm system because they had cohorts who disabled the alarm system, do those cohorts qualify as accomplices?


Madoff's relatives were undoubtedly in the scheme and should be in the dock with him. But that dock is missing some key defendants. Among the missing are former chairman of the SEC Christopher Cox and key staff members of the SEC in Boston and New York.


Harry Markopolos, who formerly worked for a hedge fund rival of Madoff's, gave testimony to Congress in the Madoff case just a few weeks ago in which he described in detail his repeated and futile attempts over a period of nine years to get the SEC in both Boston and New York to investigate Madoff and charge him with running a Ponzi scheme. The Wall Street Journal described and documented this process, which has now been pushed into oblivion. Markopolos told the Congress that it took him about five minutes to look at the returns that Madoff was paying and compare them to the stock market to conclude that a massive fraud was underway.


When the SEC finally did investigate Madoff in 2006, based on a submission by Markopolos of a document entitled "World's Largest Hedge Fund Is a Fraud," Madoff was let off with a few charges of technical violations and went on to continue his scheme.

In addition to the SEC, a principal defendant should be Alan Greenspan, former head of the Federal Reserve Board who used his power and influence to shield hedge funds from regulation. In 2004 he opposed even registration of hedge fund managers before the Senate committee, telling the committee that as long "as hedge funds remained the province of wealthy and institutional investors, additional oversight would not be needed."

To this group should be added the heads of the Treasury Department, the Senate and House banking committees, which refused to use their powers to intervene in the "casino" economy that developed at a dizzying pace in the last decade.

The SEC would not investigate. The Federal Reserve Board would not allow regulation. The Congress would not intervene. As protectors of the rich in general, these institutions made it possible for Madoff to carry out his $50 billion Ponzi scheme. He was able to operate under the regulatory radar because the leaders at the summit of finance capital deliberately put in place an apparatus whose job it is not to investigate, not to uncover, not to interfere with get-rich-quick speculation and gambling.

This arch criminal overstepped all boundaries and cheated his fellow millionaires and billionaires. He also ruined many ordinary workers in the institutions that went out of business once the scheme fell apart. But he was enabled at every step of the way by the SEC and all the other so-called "oversight" institutions of finance capital.

The capitalist media could dig all this up if they wanted to. But they are intent on keeping the spotlight on one individual criminal so that it won't fall on the much larger and truly powerful enterprise of the SEC-Fed-Treasury complex. These institutions have long protected the "legitimate" swindlers that deal collectively in the tens and hundreds of trillions of dollars. They are in collusion with the hedge funds, the private equity firms, the investment banks, the commercial banks, the mortgage industry, the credit card industry, and all the other loan sharks who have been allowed to operate with impunity as they bilked millions of workers with subprime mortgage fraud, usurious credit card interest, astronomical student loans, and other schemes.

This is the logic of the capitalist profit system. This is not a failure of the system. It is the system.

Labels: banks, capitalist, Greenspan, hedge funds, Madoff, Markopolos, Ponzi sheme, SEC

From Low-Wage Capitalism

"Thus, in order for the capitalist in company A to beat out the capitalist in company B, the workers in company A have to out-compete the workers in company B by allowing their wages to be cut below the others -- and/or submitting to speed up or other 'productivity' measures.
"The capitalists in company B then go to their own workers and tell them that in order to remain competitive with comapny A, which has just reduced its labot costs by cutting wages or benefits, the workers in company B have to at least match those cuts. And so it goes in the race to the bottom. This is the trap workers are in if their representatives buy into bourgeois ideology at the bargaining table and remain within the capital-labor framework imposed by the bosses." (Low Wage Capitalism, p. 264-265)

"Accepting the bosses' notion that labor must subordinate its demands to the overriding necessity of capital to remain competitive and profitable is a self-defeating ideology." (Low Wage Capitalism, p. 265)

"To hold the workers responsible for the profitability of capital is to demand that they agree to intensify their own exploitation to solve the crisis of their exploiters. This must be explained to the workers. They can easily comprehend it." (Low Wage Capitalism, p. 266)

"The question should be posed: Why must the exploited sacrifice their wages, their benefits, their working conditions, and their very jobs in order to maintain the continued prosperity of the exploiters, who have lived off the wealth created by the workers in the first place." (Low Wage Capitalism, p. 266)

Under pressure form the U.S. Treasury Department, the White House and the Ford Motor Company, the United Auto Workers leadership has taken a major backward step by making dangerous concessions that will undermine the economic conditions of their own membership.

According to the the New York Times the deal:

"...suspends inflation-related pay increases and performance bonuses, allows Ford to save as much as $6.5 billion by substituting shares of its stock for cash it must pay into a new retiree health care fund and eliminates the jobs bank, a controversial program that allowed workers to continue receiving nearly full pay after being laid off. Now workers whose jobs are eliminated will receive less pay, for a shorter period, and would lose that benefit if they refuse to take a job that opens up anywhere in the country."

The UAW leadership proclaimed that the new agreement brings hourly labor costs to $55 an hour. First of all, this does not represent the wages of the workers but rather an average of overall costs to the company for retirees pensions, health care and other benefits.

But most importantly, and most dangeroulsy, the union announcement declared that this latest agreement is a step in the direction of bringing Ford pay scales down to the level of Toyota, Honda, Nissan and other overseas companies.

In other words, the goal of the negotiations is to bring the pay scale of the organized workers down to the level of unorganized workers -- to reduce the status of union workers to the status of non-union workers.

This amounts to allowing the auto bosses to push the economic crisis onto the backs of auto workers. A leadership that represents labor should be going in the opposite direction -- the direction of struggle against concessions.

Instead of negotiating to bring the conditions of their own membership down to the level of unorganized workers, what is need is a mass fightback to raise the conditions of not only the Ford workers and the auto workers, but the broader working class.

These concessions, should they be allowed to stand, do not only affect the Ford workers, they stand as a precedent for GM and Chrysler. One antidote to the concessionary drive of the profiteering auto magnates would be to shut down Ford, Chrysler, GM and all the parts plants that supply the auto industry. That would open the class struggle and push things back in a progressive direction.

If concessions were necessary after the struggle, then the union could make concessions. But no one knows what the outcome of such a struggle would be. It could be that instead of concessions there could be great gains. There is no way to determine this except by fighting back.

To make concessions in advance, without a fight, assures a negative outcome. What is needed is for the rank-and-file to begin to organize from below and to eventually reverse the course of retreat that has been followed for the past three decades.

Labels: capitalist, capitalist crisis, Chrysler, concessions, Ford, GM, jobs bank, low-wage capitalism, non-union, retiree, Toyota, treasury, UAW, unions, wages, White House

Geri Jenkins, from the newly formed 150,000-Strong Nurses’ Union, representing 10 percent of the nurses in the U.S., explains that creating a national single-payer health care system, as outlined in Rep.John Conyers’s bill, HR 676, could provide medical care for everyone who is now uninsured and would create a net of 2.6 million new jobs.

Watch the video here.

Labels: democracy now, healthcare, john conyers, single payer